According to the Complaint, Livent produces and distributes chemicals. Its primary products are battery-grade lithium hydroxide, butyllithium, and high purity lithium metal.
In October 2018, Livent completed its initial public offering (“IPO”) in which it sold 23 million shares of its common stock at $17.00 per share.
On February 11, 2019, Livent released its fourth quarter 2018 financial results that missed top line sales targets, citing difficulties negotiating contracts with existing customers. On this news, Livent’s share price fell $0.57, over 4%, to close at $12.55, on February 12, 2019.
Then, on May 8, 2019, the Company announced disappointing financial results for first quarter 2019, citing further customer issues. On this news, Livent’s share price fell $1.70, nearly 16%, to close at $9.03 on May 8, 2019.
The Complaint alleges that Livent's Registration Statement was false and misleading and omitted to state material adverse facts. Specifically, the Complaint alleges Defendants failed to disclose to investors: (1) that a supply contract with Nemaska Lithium Inc. had been terminated; (2) that, as a result, the Company would be forced to fulfill its customer contracts using alternative vendors at reduced revenues and lower margins; (3) that the Company had a long-standing contract to supply lithium hydroxide to a customer at a much lower price than any of the Company’s existing contracts; (4) that the Company’s margins were squeezed due to the customer’s increased orders; and (5) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
On August 20, 2019, the Court issued an Order consolidating cases and appointing Lead Plaintiff and Counsel. Lead Plaintiff filed a consolidated amended Complaint on October 4. On October 18, Lead Plaintiff corrected the consolidated amended Complaint. The Court issued an Order consolidating cases on October 25. Defendants filed a Motion to Dismiss the consolidated amended Complaint on November 18. On July 2, 2020, the Court issued an Order granting Defendants' Motion to Dismiss. Lead Plaintiff filed a Notice appealing the Court's Dismissal Order on July 31.